Connect with us

Economics

PCE inflation September 2024:

Published

on

Key Fed inflation rate hits 2.1% in September, as expected

Inflation increased slightly in September and moved closer to the Federal Reserve’s target, according to a Commerce Department report Thursday.

The personal consumption expenditures price index showed a seasonally adjusted 0.2% increase for the month, with the 12-month inflation rate at 2.1%, both in line with Dow Jones estimates. The Fed uses the PCE reading as its primary inflation gauge, though policymakers also follow a variety of other indicators.

Fed officials target inflation at a 2% annual rate, a level it has not achieved since February 2021. The September headline rate was down 0.2 percentage point from August.

Though the headline number showed the central bank nearing its goal, the inflation rate was at 2.7% excluding food and energy, after the so-called core measure increased 0.3% on a monthly basis. The annual rate was 0.1 percentage point higher than forecast but the same as in August.

The move in inflation was tilted towards services prices, which increased 0.3%, while goods prices decreased 0.1%, the fourth outright deflation figure in the past five months for the category. Housing prices eased off their pace, rising 0.3%. Energy goods and services fell 2%.

The report comes with markets betting heavily that the Fed will cut its benchmark short-term borrowing rate when it meets next week. In September, the Fed slashed the rate by a half percentage point, a move virtually unprecedented during an economic expansion.

Policymakers have expressed confidence that inflation is heading back to target while at the same time showing concern over the state of the labor market despite most indicators showing that hiring is continuing and layoffs are low.

A separate report Thursday morning reinforced the notion that companies are mostly hanging onto their workers.

Initial filings for unemployment benefits totaled 216,000 for the week ending Oct. 26, a decrease of 12,000 from the previous period’s upwardly revised level, according to the Labor Department. The total was also below the 230,000 forecast.

Despite worries over inflation, the Commerce Department report showed income and spending held up during the month.

Personal income increased 0.3%, slightly higher than the August number and in line with expectations. Consumer spending rose 0.5%, topping the outlook by 0.1 percentage point.

In yet another data point Thursday, the Bureau of Labor Statistics reported that the employment cost index increased 0.8% in the third quarter, 0.1 percentage below forecast. On a 12-month basis, the index, which measures wages, salaries and benefits, increased 3.9%, compared to a 2.4% increase in the consumer price index.

Continue Reading
Click to comment

Leave a Reply

Your email address will not be published. Required fields are marked *

Economics

Democrats are still processing their defeat

Published

on

THESE ARE NOT the reports Democrats were hoping to prepare. Instead of transition plans for the incoming Kamala Harris administration, draft executive orders and legislative outlines, Democrats are producing post-mortem analyses of how their campaign came apart in 2024. Those Democrats who are honest with themselves are recognising an uncomfortable truth: as awful, immoral and weird as they consider the Republican Party, the American people considered it to be the better option for governing America.

Continue Reading

Economics

Will Donald Trump now pardon the January 6th rioters?

Published

on

Many Americans hope that Donald Trump will fulfil his campaign pledges to bring down prices and deport illegal immigrants. But a small group of convicted rioters are on tenterhooks over another electioneering promise. Mr Trump has repeatedly vowed to free his supporters who were imprisoned for storming the Capitol on January 6th 2021. He has repeatedly called them “hostages” and “unbelievable patriots” while recasting the attempt to disrupt the peaceful transfer of power as “a day of love”. “Why are they still being held?” Mr Trump mused weeks before the election. His return to the White House means he could soon pardon them all.

Continue Reading

Economics

How Donald Trump could win the future

Published

on

The Democrats’ appeal to Silicon Valley is eroding

Continue Reading

Trending